Trade Minister Mark Vaile last week defended Australia's right to provide short-term assistance to struggling sectors of the economy or to subsidise industries to help them get established.

Last week, Mr Vaile received a strongly worded letter from the Brazilian ambassador to Australia, Antonio Dayrell De Lima, which basically accused Australia of hyprocisy after the Federal Government decided to impose a fuel excise on ethanol while directly subsidising the local industry to offset the new tax.

"We will be saying that …Australia has resorted to trade practices which it condemns in others," the ambassador said.

"The Brazilian Government regrets that Australia should adopt such an unwarranted measure, given its leadership of the Cairns group, where it supports reforming trade in agriculture."

However Mr Vaile said the assistance being provided to both the local ethanol and the sugar industry was permitted under World Trade Organisation rules.

"It's not about keeping industries on the drip, it's about getting industries to change their structure and practices so they become internationally viable and sustainable without protective measures," Mr Vaile said.

Revenue Minister Helen Coonan could guarantee only that petrol prices "need not" rise as a result of a new federal tax on ethanol products. Asked to give a guarantee there would be no impact on prices, Senator Coonan said: "This is not a matter on which one can give guarantees."